Futures on the S&P 500 and Nasdaq plummeted 5 percent early on Friday and triggered overnight circuit breakers after Britain’s vote to quit the European Union catapulted global markets into turmoil.
Advertisement
Amid swirling uncertainty over the impact of the so-called “Brexit”, the Dow Jones Industrial Average fell 402 points as of 10:35 a.m. ET, a 2.2% drop. From Europe to As… Eight of the 10 major S&P 500 sectors were lower, with the financial index’s 3.69 percent leading the decliners. Germany’s DAX tanked more than 7%, the CAC 40 in France fell 6.8%, and the FTSE 100 in London declined 4.4%.
After showing a steep drop at the start of trading, stocks continue to see considerable weakness in mid-day trading on Friday.
Stocks and commodities, such as oil, will likely suffer losses as well, due to market uncertainty and confusion over the potential fallout a “leave” vote would produce. The benchmark erased its gain for the year, which reached as much as 3.7% earlier this month.
Equities sank to session lows in afternoon trading, with the Dow Jones sliding more than 600 points. The pound plunged the most in 30 years and European equities dropped as investors weighed the implications for the global economy.
Cooper said expectations earlier this year were that the U.S. Federal Reserve could increase interest rates one or two times later this year, but that is no longer the case.
“We’re seeing some selling pressure today primarily because a lot of investors and market participants were not anticipating this outcome”, said David Lefkowitz, senior equity strategist at US Bank Wealth Management Americas in NY. United Kingdom residents will decide Thursday on whether Britain should make an exit – or Brexit – from the European Union.
The CBOE Volatility index ended up 49 per cent at 25.76, its highest level since February 11 – when equities hit their lows of the year.
Exxon and Chevron were down about 2.5 per cent.
Barrick Gold jumped 5.8 per cent, Newmont Mining 5.1 per cent and Goldcorp 4.4 per cent. Just 171 companies in the S&P 500 disclosed sales from Europe in 2015, and the region was responsible for just 6 percent of total revenue in the index, according to data compiled by Bloomberg.
The stock was down 4.15% on the NASDAQ at press time, while Apple was trading 2.81% lower than yesterday’s closing price.
Nine of 10 industry groups in the S&P 500 declined on the week, as phone stocks were the only sector to eke out a gain.
Declining issues outnumbered advancing ones on the NYSE by 2,575 to 480. On the Nasdaq, 2,439 issues fell and 326 advanced.
Advertisement
The SP 500 index showed two new 52-week highs and six new lows, while the Nasdaq recorded eight new highs and 66 new lows.
